XG177

[TEMP CHECK] AAVE Treasury Proposal for RWA Allocation with Maple Finance

Voting ended about 2 years agoSucceeded

Title: [TEMP CHECK] AAVE Treasury Proposal for RWA Allocation with Maple Finance

Author: @Maple_Direct

Created: 2023-11-20

Summary

Maple Finance would like to propose that Aave’s Treasury allocates stablecoins into Maple Finance’s cash management pool to earn the risk-free rate on-chain, further diversifying their existing and future RWA holdings.

The main results of this proposal will be:

Aave will onboard with Maple Finance to enable the treasury to allocate to RWA strategies on the platform.
Aave Treasury to allocate to Maple’s Cash Management pool, with an initial investment of 1M USDC, with the goal to increase this allocation over the course of time.
As the Aave community gains comfort in the Maple platform, the treasury will explore investment opportunities into other Maple RWA pools, pending approval from Aave’s governance.

Motivation

Shifting away from an exclusive focus on crypto assets, Aave is now exploring off-chain markets, particularly Real World Assets (RWA). This strategic move holds the promise of diversified treasury management, achieved through a thoughtful percentage allocation of Aave’s current USDC balance. This forward-thinking approach positions Aave to leverage RWA collateral for long-term growth, whether by enhancing liquidity, diversifying revenue streams, or capitalizing on earnings from dormant stablecoin assets.

Maple Direct is excited to introduce the Cash Management Pool (MPLcashUSDC) to the Aave community. Since launching in May 2023, Maple’s Cash Management Pool has attracted >60M USDC in total deposits and generated >500k USDC in accrued interest for lenders. The Pool is permissioned and available to accredited investors who complete a KYC and AML onboarding process with Maple, with more than 50% of current lenders either DAOs or web3 corporate treasuries. Backed by short-term US Treasury bills and overnight repos, the Pool targets a net APY of the current Secured Overnight Financing Rate as reported by the Federal Reserve Bank of New York, less 50bps of annualized fees and expenses. At current rates, the spot net APY of MPLcashUSDC is approximately 4.8%.

Maple’s Cash Management pool is highly differentiated from competitors, including the following benefits:

Direct Asset Security: Actively managed and directly backed by US Treasury bills held in a standalone SPV.
Daily Liquidity: Withdrawal function offering daily liquidity on US banking days, automated through smart contracts to ensure limited reliance on third parties.
Short Duration: Weighted average maturity of the Pool’s assets is capped at 30 days – this restriction materially mitigates interest rate risk and ensures reliable access to daily liquidity for lenders.
Yield Efficiency: Upon a new deposit, an LP token (MPLcashUSDC) is atomically transferred to the lender’s wallet and yield starts accruing immediately. Lenders continue earning interest up until the moment their LP tokens are redeemed from the pool for USDC. Fees and expenses total 0.5% annualized and there are no upfront subscription or redemption costs.
On-Chain, Verifiable Position: Maple’s smart contract infrastructure has been built out over the last 3 years and one of the major benefits it provides is a constant, verifiable Net Asset Value (NAV) for lenders. Using the ERC-4626 standard each lender can verify the value of their holdings directly on-chain and the yield that they have earned to date. Importantly, this value is generated block by block through the smart contracts and is not subject to any manual manipulation or input.
Regulated Counterparties: Custodial risks are minimized by partnering with established and regulated counterparties. The Pool’s prime broker is StoneX, a SEC and FINRA regulated broker dealer. BNP Paribas, the fifth-largest global custodian with over $10 trillion in assets under custody, is the underlying custodian for the StoneX account.
Fully Ringfenced: As with all pools on Maple, the Cash Management Pool represents a distinct smart contract and Lenders are ringfenced from credit risk in other pools on the Maple platform. Lender deposits in the Pool are held in a non-custodial smart contract and Maple never takes possession.

Specification

If the proposal is approved, Maple Direct is prepared to work hand in hand with the Aave DAO to engage counsel and determine the appropriate legal structure for the DAO to access KYC permissioned defi, including the Cash Management pool (and other alternatives on the platform). Maple would be responsible for onboarding the eventual legal entity associated with the Aave DAO, and would draw upon experience working with other DAOs in the space to complete KYC in a compliant manner.

The investment process will be gradual and thoughtful, with community approval sought for each stage after the endorsement of this proposal. Initially we propose a 1M USDC deployment in the Maple’s Cash Management Pool. In subsequent stage, we believe the Aave DAO should consider higher yielding opportunities, including the various offerings on Maple as well as other defi platforms.

Maple Direct stands ready to assist the Aave DAO in allocating across various credit opportunities, fostering flexibility and strategic decision-making.

credit opportunities.png

We believe it is in the best interest of the community to start with an initial investment and gain familiarity with the Maple Platform. As the relationship strengthens after initial deployment, we will seek investment into other Maple pools. A timeline of events can be seen below:

timeline of events.png

The fee structure for the Cash Management pool is 0.5% annualized.

Additional information covering the Cash Management Pool, including lending, withdrawing, and risks is detailed on GitBook as well as the other materials linked in Key Documents below.

Pool Factsheet 4 WebApp Lender Presentation 1 MPLcashUSDC Contract

Next Steps

This proposal will move to an off-chain snapshot vote in 7-14 days, and if successful, to an on-chain AIP immediately after. The Maple Finance team is available for a community call to discuss this proposal, our platform, and other topics in further detail as requested by the Aave community.

Disclaimer

This TEMP CHECK is powered by Skywards. The Aave Chan Initiative has not received any form of compensation from Maple Finance for creating this proposal.

Copyright

Off-Chain Vote

YAE

47.34K AAVE11.4%

NAY

368.69K AAVE88.6%

ABSTAIN

7.29 AAVE0%

Quorum:130%

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Discussion

[TEMP CHECK] AAVE Treasury Proposal for RWA Allocation with Maple Finance

Timeline

Dec 06, 2023Proposal created

Dec 07, 2023Proposal vote started

Dec 10, 2023Proposal vote ended

Feb 03, 2026Proposal updated

Summary

The main results of this proposal will be:

Aave will onboard with Maple Finance to enable the treasury to allocate to RWA strategies on the platform.

Aave Treasury to allocate to Maple’s Cash Management pool, with an initial investment of 1M USDC, with the goal to increase this allocation over the course of time.

As the Aave community gains comfort in the Maple platform, the treasury will explore investment opportunities into other Maple RWA pools, pending approval from Aave’s governance.

Motivation

Maple’s Cash Management pool is highly differentiated from competitors, including the following benefits:

Direct Asset Security: Actively managed and directly backed by US Treasury bills held in a standalone SPV.

Daily Liquidity: Withdrawal function offering daily liquidity on US banking days, automated through smart contracts to ensure limited reliance on third parties.

Short Duration: Weighted average maturity of the Pool’s assets is capped at 30 days – this restriction materially mitigates interest rate risk and ensures reliable access to daily liquidity for lenders.

Yield Efficiency: Upon a new deposit, an LP token (MPLcashUSDC) is atomically transferred to the lender’s wallet and yield starts accruing immediately. Lenders continue earning interest up until the moment their LP tokens are redeemed from the pool for USDC. Fees and expenses total 0.5% annualized and there are no upfront subscription or redemption costs.

On-Chain, Verifiable Position: Maple’s smart contract infrastructure has been built out over the last 3 years and one of the major benefits it provides is a constant, verifiable Net Asset Value (NAV) for lenders. Using the ERC-4626 standard each lender can verify the value of their holdings directly on-chain and the yield that they have earned to date. Importantly, this value is generated block by block through the smart contracts and is not subject to any manual manipulation or input.

Regulated Counterparties: Custodial risks are minimized by partnering with established and regulated counterparties. The Pool’s prime broker is StoneX, a SEC and FINRA regulated broker dealer. BNP Paribas, the fifth-largest global custodian with over $10 trillion in assets under custody, is the underlying custodian for the StoneX account.

Fully Ringfenced: As with all pools on Maple, the Cash Management Pool represents a distinct smart contract and Lenders are ringfenced from credit risk in other pools on the Maple platform. Lender deposits in the Pool are held in a non-custodial smart contract and Maple never takes possession.

Specification

Maple Direct stands ready to assist the Aave DAO in allocating across various credit opportunities, fostering flexibility and strategic decision-making.

The fee structure for the Cash Management pool is 0.5% annualized.

Additional information covering the Cash Management Pool, including lending, withdrawing, and risks is detailed on GitBook as well as the other materials linked in Key Documents below.